Styrolution to build styrenics line in Mexico; explores jv with Braskem in Brazil

Germany-headquartered Styrolution is to construct a line for alpha methyl styrene acrylonitrile (AMSAN) at its site in Altamira, Mexico. Styrolution uses AMSAN in its Luran S acrylonitrile styrene acrylate (ASA) and high-heat Novodur acrylonitrile butadiene styrene (ABS) products. The new production line will enable Styrolution to expand its product offering and increase supply reliability in the region. It will also position the company for further growth throughout the Americas as well as in key industries, such as automotive and construction. Production is set to start in the second quarter of 2014.

Products which include AMSAN are known for their heat resistant characteristics and aesthetics, said the firm, adding that its Luran S 778T, Novodur HH 106 & 112, and Luran HH 120 are, thus, ideal for use in the automotive industry where applications demand premium appearance and performance at elevated temperatures. Another unique characteristic of AMSAN is its compatibility with PVC as a heat resistance modifier, which is especially important in the building and construction market for producers of siding, decking and fencing.

Currently, AMSAN is imported by Styrolution to the region from its plant in Ludwigshafen, Germany. With the new line, it will then be the only producer of AMSAN in Europe and the Americas.

The new plant is also in line with Styrolution's intention of a triple shift growth strategy, which calls for a shift to lend greater focus on measures that will expand its footprint in three key areas: styrenic specialities, emerging markets and higher-growth industries.

Meanwhile, the new plans for Altamira follow on the heels of an earlier announcement by Styrolution and Braskem to explore a joint venture to produce ABS and copolymers in Brazil. The proposed 100 kt plant would supply speciality styrenics, ABS and styrene acrylonitrile (SAN) copolymers, to customers in Brazil and throughout South America.

With a population of over 200 million and an estimated GDP of over US$2.3 trillion, the Brazilian market is robust. In recent years, Brazil has seen significant growth in the household appliance and automotive industries, both of which are key consumers of the speciality styrenics the joint venture would produce. Traditionally, ABS and SAN have been imported into the region by styrenics providers like Styrolution.

Styrolution's contribution to the proposed joint venture would include its expertise in the development and production of styrenics, the industry's broadest styrenics product portfolio, technology licensing and its existing business in the region. As the region's top petrochemical company, Braskem would provide its knowledge of the local and regional markets, supply chain infrastructure and the site for the production facility.

The consummation of the joint venture is subject to regulatory and antitrust approvals. It is planned that Styrolution would be the majority shareholder with 70% and Braskem holding 30%t. Subject to an agreement by both parties to proceed and provided relevant approvals are obtained, groundbreaking for the site could be expected as early as 2015 with production likely starting in 2017.


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